Fiscal policy

President Klaus Iohannis has announced on Wednesday that an extraordinary budget revision is being shaped up, destined to earmark money for Health and the payment of technical unemployment. "An extraordinary budget revision is being shaped up which will be carried out in this state of emergency on two levels.

The thirty-six Bulgarian municipalities that have not participated in the WiFi4EU free Wi-Fi initiative in the public sector so far, can now apply for the new competition, the Ministry of Transport Information and Communications announced.

The competition will open on March 17. Municipalities must register in the WiFi4EU portal before that date.

The new pensions law is the main factor causing the rapid increase in the general government deficit up to 6.1 percent of the GDP in 2021, and the high fiscal sustainability risks, the European Commission estimated in the Country Report for Romania published on Wednesday.

The US designated Bulgaria a developed country. The measure makes it easier for Washington to launch investigations and impose customs and other penalties if it finds unlawful subsidies or commercial practices, BNR reported.

The fiscal budgetary strategy for 2020-2022, adopted by the Government on 10 December 2019 and sent to Parliament, stipulates a deficit target of 3.8 percent of the GDP in 2019, a figure which, according to the European Commission, provides prima facie evidence of the existence of an excessive deficit in Romania, according to a report adopted by the European Commission on Friday.

The countdown has started for the drafting of the 2021-24 midterm fiscal plan, with interest focusing on the new tax breaks it will include, which will depend on whether or not the primary budget surplus target is brought down. It will therefore include two scenarios, one with a target of 3.5 percent of gross domestic product for 2021 and 2022 and another with a reduced target.

Romania will fall under the excessive deficit procedure, something that cannot be avoided and the earliest it can happen is in March, Minister-designate of Public Finance Florin Citu told Monday evening private TV broadcaster Realitatea Plus. "The talks are ongoing with the European Commission. (...) And, yes, Romania will enter the excessive deficit procedure.

The European Commission took the first step on Wednesday to overhaul the fiscal rules that underpin the euro by launching a public consultation to help find common ground among deeply divided governments.

Greece on Monday announced that it had appointed banks for a new 15-year bond issue after its credit rating was upgraded by one of the three main rating agencies. 

It will be the first time Greece is tapping with a markets whose expiry date is after 2032, the year in which long-term measures for the relief of Greece's debt burden are due to expire.  

The continuation of yield chasing by investors has led to record demand for government bond issues in the eurozone.